How to beat the household tax

The Government plan to introduce a property tax on the family home and a water tax by 2014. They are introducing a household charge in January as an “interim measure” for 2012 and 2013. The charge will start at 100 euro for 2012. It will be levied on 1.6 million households or 86% of all households in the state.

Since publication of this article, further details of how the tax is being introduced have come out, these can be read in this article by Joe Higgins TD.

Among the people who will be hit by the charge are people who have already been heavily penalised for the crime of owning a home such as people in negative equity and people in serious mortgage arrears. Having been stung by the bankers and developers who inflated the property market for profit they now are to be hit with a new tax to fund the bankers’ bailout.

Also hit by the tax will be some of the poorest and most vulnerable individuals in our society such as pensioners who have the state pension as their sole source of income and hundreds of thousands of unemployed people trying to survive on a dole which has already been cut several times.

John Fitzgerald’s interview with Matt Cooper shows why the Government will fight tooth and nail to drive these taxes through. For the ruling class, the household charge holds the key to fundamentally changing the country’s tax base and to provide them with a “revenue stream” of 1-2 billion per annum.

John Fitzgerald: 100 euro is relatively low… I think this is just the beginning.

Matt Cooper: How much would you expect a property tax overall to raise in a particular year once it’s introduced in 2014 onwards?

John Fitzgerald: I would be looking for a billion euro not 160 million

Matt Cooper: So that would suggest you are talking on average 700-€800?

John Fitzgerald: Yeah.

Matt Cooper: And what about water charges on top of that again?

John Fitzgerald: Water charges would probably be another €500.

(Extract taken from interview on Today FM July 27 between Matt Cooper and John Fitzgerald, chief research officer at the Economic and Social Research Institute. The ESRI is the government’s semi-official economic thinktank).

However, the fact that the household charge is a “bridge” towards a property tax and a water tax which could cost households more than 1000 euro a year is a powerful reason why it should be vigorously opposed right from the very start through a campaign of organised mass non-payment.

After 3 years of austerity the household charge is just the latest attack on ordinary working class people. Mass unemployment, mass emigration and vicious cuts in health and education have impacted on millions. Mortgage hikes, the Universal Social Charge and now gas and ESB price increases have brought many towards breaking point. For masses of people the household charge, the property tax and the water tax will be the final straw. It is a chance for people to draw a line in the sand and say “we’ve had enough!”.

Nor will the charge do anything to aid economic recovery. The charge will take spending money out of people’s pockets, directly cut the amount of money that households spend in the shops, increase unemployment and worsen, not improve, the economic situation.

Furthermore, the charge is a completely unfair tax. It is a “flat tax” which asks the ordinary couple in the modest home to pay the exact same amount as the millionaire or the billionaire in his mansion.

An Irish Examiner online poll at the end of July showed 85% of respondents opposed to the household charge. Thirty-three percent said that they won’t pay. Twenty-two percent said that they can’t afford to pay. Thirty percent expressed opposition but felt that they may have to pay against their will.

This poll shows huge potential for an organised mass campaign of non-payment. It also shows that a campaign will not be a walkover and that non-payment will need to be argued for and built.

The first point to be made here is that campaigns of mass non-payment can defeat governments on issues such as this. In Britain in the late 80s/early 90s the All Britain Anti-Poll Tax Federation (led by our sister organisation) organised 18 million non-payers in a campaign which not only defeated the poll tax but ended the political career of Margaret Thatcher. In Dublin in the mid-90s the Anti-Water Tax Federation, led by the Socialist Party, organised a non-payment campaign which defeated the water tax.

It is true that a Fianna Fail/PD Government forced through the bin tax in 2003 and defeated a campaign of mass non-payment. But the economic backdrop to that victory for the capitalist establishment is very, very different to the economic backdrop this time. Paying €1000 a year for owning a home and having a water supply after 3 years of vicious austerity is likely to produce a far stronger reaction than paying €5 a fortnight for a bin tag at the height of the Celtic Tiger boom.

The Government will, of course, go to great lengths to force these changes through. Already they have announced escalating fines of 10 euro per month for non-payers. They have pledged to introduce legislation in the current Dail term outlining further penalties. They have issued leaks to the press indicating that jail for “persistent nonpayers” is under consideration.However, all this would have a hard job budging a non-payment campaign if that campaign had a million or half a million people sticking by non-payment.

The household charge/water tax can cause particular problems for Labour as it directly attacks their support base. The more vigorous the measures chosen to attack non-payment the bigger the potential backlash against the Government in general and Labour in particular.

The Campaign Against Household and Water Tax is launching into community-based public meetings nationwide in September/October to lay the foundations of a mass non-payment campaign. Hard work in the run-up to Christmas can see active campaign groups, however small initially, established in all these areas. When the tax goes “live” in the New Year these groups can then be well-positioned to step up a gear and organise a real non-payment movement in their respective communities.

Socialist Party members and all our supporters will play a key role in launching this work over the weeks ahead.

We will do so in the knowledge that such a campaign has the potential to mount a very serious challenge to the Fine Gael/Labour government and their entire austerity drive against the living standards of working class people.